Business Plan Training Session 1: Defining the Business

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Describes how to define your business and/or products/services when building a business plan

Transcript of Business Plan Training Session 1: Defining the Business

  • 1. Business Plan Training Series
    Section1: Product/Business
    Chuck Behn
    7 July, 2011

2. People Over 35 Launched 80% Of Startups in 2009 . Global Entrepreneurship Monitor
People over 55 are nearly twice as likely to launch startups in "high-growth" industries -- including aerospace, defense, health care, andcomputerand electronics Kaufmann Foundation
companies started by older workers don't get much recognition because they don't generally produce hot Web apps or other easily understood products. Instead, they tend to involve more complex technologies like biotech, energy, or IT hardware. They also tend to sell products and services to other businesses, which consumers rarely see but which do most of the heavy lifting in poweringinnovationand economic growth."
Entrepreneur Headlines
3. Good service keeps this customer happyFort Worth Star-Telegrampg 19A, 7/4/11E.B. Holschuh III
Restaurant
Dentist
Mechanic
4. Executive Summary
Product/Business
Market opportunity definition
Competition
Marketing & Sales
Management
Finance/Risks
Appendices
Components of a Business Plan
5. Do I Have a Product or Business Idea?
Product
Business
Provides a solution to a question/problem
Can become a profitable business unto itself if market is large enough
If successful, is differentiated and efficient in delivering its solution
Sustainable
Scalable
Creates competitive advantage
A grouping of products and/or services
A successful transition of product to business: Vitamin Water differentiated itself from all other water products using flavor and ingredients sold for $4.2B
6. Business and/or Product
Business
Product/Services
What does your business do?
What are your long term goals/objectives?
How is your business different from competition?
What will make people want to buy from you?
Description of products & services
Positioning
Competitive evaluation
Product/Service rollout plan
7. Who is your customer?
What customer problem(s) do you solve?
What value do you provide?
How do you make money?
What are your costs?
How profitable will you be?
What Does Your Business Do?
8. Music Publisher rights exploitation business
Search Engines web portals
Financial Advisor selling time
Cake/cookies Bakery gift shop
Concise Business Descriptions
What is yours?
9. Goal 1: Build business to $x Revenue and SELL!
Objective 1: Achieve in Y years
Objective 2: % Profit
Goal 2: Excel in xxxx
Systems
Personnel
Training
Differentiate
Method 1
Method 2
Become innovation leader in zzzzzzz
Method 1
Method 2
What are your goals/objectives?
10. 11. Compared to:
Competition
Parallel businesses in other industries
Your industry
Substitute products and services
How is your business different?
12. Differentiation Examples
In a crowded personal computer marketplace, Dell sold direct to order, and stood out.
When other fast food chains were getting healthy, Hardees reinvented itself with the Thickburgers. (Unapologetically, the Monster Thickburger contains 1,420 calories!)
Ignored airports and focused on suburban locations and the insurance replacement market
Barbie is an all-American childrens doll, while Bratz is a hip, modern doll with attitude.
When Crest and Colgate fought over market share for cavity and tartar control, Toms advertised all-natural ingredients (and Colgate bought them out for a cool $100 million).
13. Unique products/services
Customer niche
Inventory
Unique distribution
Price
Service
Guarantee
Reputation
Why would someone buy from YOU?
14. Walmart vs. Nordstroms
Ford vs. Chevrolet
McDonalds vs. Jack-in-the-Box
Dell vs. Apple
TXU vs. Reliant Energy
Tom Thumb vs. Kroger
Geico vs. Allstate
Centex vs. David Weekley
Why would someone buy from the following companies?
15. Physical description
Pictures, drawings, diagrams are also helpful
Uses/benefits
What problem(s) are you solving?
What extra benefits are provided?
Stages of development
Concept development
Beta testing
Technical implementation
Commercialization
Product/ServiceDescription
16. Product/ServiceDevelopment Tools/Methodologies
DFSS Design for Six Sigma
QFD Quality Function Deployment
Stage Gate Process
Target Costing
Integrated Product Teams
17. Direct competitors
Potential competitors
Buyers
Suppliers
Substitute products
Strengths/Weaknesses/Opportunities/Threats (SWOT) analysis on company and product(s)
Product/ServiceCompetitive Evaluation
18. 19. Product/ServicePositioning Separation from competitors
Potential Positioning Strategies
Does your Positioning:
Against/Away from competitors (Avis, were #2)
Emphasis on benefits (Volvo, safety)
Product Attribute (Motel 6, economy)
How used (Jeep, off road)
Users (_____ for Dummies books)
Have one clear message?
Connect with/pertinent to the target audience?
Contrast your strengths against the competition?
Resonate with customers into the future?
Is it believable and can you substantiate all claims?
20. 21. What product is coming out when and with what features
Planned future releases by product
Product life cycle
Allocated resources
Planned results (financial, market share, etc.)
Product/ServiceRollout Plan
22. BlackberryRollout Plan
23. Business Concept Example
Morning Star Espresso Company is a new espresso business that is scheduled to begin operations on January 1, 2003. The reservation based, Indian owned enterprise will be managed and operated by Kim Smart, sole proprietor.
24. Service Description Example
JavaNet will provide its customers with full access to the Internet and common computer software and hardware. Some of the Internet and computing services available to JavaNet customers are listed below:
Access to external POP3 email accounts.
Customers can sign up for a JavaNet email account. This account will be managed by JavaNet servers and accessible from computer systems outside the JavaNet network.
FTP, Telnet, Gopher, and other popular Internet utilities will be available.
Access to Netscape or Internet Explorer browser.
Access to laser and color printing.
Access to popular software applications like Adobe PhotoShop and Microsoft Word.
JavaNet will also provide its customers with access to introductory Internet and email classes. These classes will be held in the afternoon and late in the evening. By providing these classes, JavaNet will build a client base familiar with its services. The computers, Internet access, and classes wouldn't mean half as much if taken out of the environment JavaNet will provide. Good coffee, specialty drinks, bakery goods, and a comfortable environment will provide JavaNet customers with a home away from home. A place to enjoy the benefits of computing in a comfortable and well-kept environment.